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Do Time Poor Individuals Pay More?

Tim Rathjen

No 91, FFB-Discussionpaper from Research Institute on Professions (Forschungsinstitut Freie Berufe (FFB)), LEUPHANA University Lüneburg

Abstract: There is a rising number of concepts that try to describe the broad perception of time poverty. Though detailed time poverty analyses are available, still little is said about its impacts on the individual behaviour. Within this article, a possible new implication is analysed: The author tests whether time poor individuals compare less between prices as a result of their time deficit, therefore do not identify “bargains or rip-offs” and pay on average more for identical products and services than not time poor individuals. Using data drawn from the German Time Use Survey (GTUS) 2001/02, time use information is imputed into the German Sample Survey of Income and Expenditure (IES) 2003 to identify time poor individuals in the IES 2003. Instrumental variables estimations are arranged to account for an expected bias in ordinary least squares estimations – caused by the excluded variable (search) ability – and to catch the causal effect of time poverty on paid prices. The results do not confirm a higher price paid by time poor individuals. The findings rather suggest that time poor persons find trust in stores with a fair price performance ratio, remain loyal to them and accordingly pay a similar amount for goods and services than not time poor individuals in most cases.

Keywords: Time poverty; Time use and well-being; Price dispersion; Price Search; Asymmetric Information (search for similar items in EconPapers)
JEL-codes: D12 D82 D83 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2011-10
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